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State of Rhode Island and Providence Plantations STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS PROVIDENCE, SC SUPERIOR COURT : CHAPMAN STREET REALTY, : INC., ET AL. : : : v. : C.A. No. 2001-2217 : : DEPARTMENT OF BUSINESS REGULATION, ET AL. DECISION GIBNEY, J. Before this Court is petitioners’ appeal from a decision of the Department of Business Regulation (DBR), denying a liquor license transfer from petitioner Laurence E. DeChristofaro, Jr. to petitioner Francisco Batista. The petitioners argue that the Hearing Officer abused his discretion and committed error of law by refusing to grant the liquor license transfer. Jurisdiction is pursuant to G.L. 1956 § 42-35-15. Facts/Travel Petitioner, Lawrence E. DeChristofaro, Jr., (DeChristofaro), was the owner of a bar known as “Chaps,” for which he was the holder of a Class BX liquor license. In September 1998, DeChristofaro entered into a purchase and sale agreement to sell Chaps and to transfer its liquor license to petitioner, Francisco Batista, hereinafter “Batista.” Batista was at the time, and currently is, involved with running a club called “Club 3030.” On October 13, 1999, the Providence Board of Licenses denied the liquor license transfer application. Batista appealed to the Rhode Island Department of Business Regulation. At the 1 hearing before the DBR, the primary witness in opposition to the liquor license transfer was Louis A. Aponte, the area Councilman. (Tr. at of December 15, 1999 at 16-17.) Councilman Aponte expressed community concerns that Chaps, which had traditionally been run as a local bar, would attempt to expand and that this expansion would deleteriously affect the character of the neighborhood. Id. Settlement negotiations resolved these community concerns through a consent agreement signed on February 21, 2000. The consent order stated that the application to transfer the license was to be granted upon the following terms: 1. Batista Realty, LLC. agrees that it will provide the Washington Park Foundation written notice at last 30 days in advance of any presentation at Chaps Cafe involving live entertainment. 2. Batista Realty, LLC. agrees to monitor parking by patrons of Chaps Cafe on Chapman Street and O’Connor Street and to assure that there is no interference with the existing businesses and residential homes on Chapman Street and O’Connor Street. 3. Batista Realty, LLC. agrees that every night that Chaps Cafe is open, upon closing, they will remove all bottles and cans from Chapman Street. 4. Batista Realty, LLC. agrees that Franciso Batista will make himself available to the Washington Park Foundation, in person, upon receiving written notice at least 15 days in advance of the purpose of the meeting, the time, date and place of the meeting. 5. Batista Realty, LLC. agrees that it will provide at least two security officers whenever Chaps Cafe is open after 9 p.m. and until closing, on Fridays, and Saturdays, and Sundays before a R.I. holiday. Batista Realty, LLC. further agrees that whenever there is a presentation involving live entertainment on said nights the two security guards will be uniformed Providence Police Detail Officers. 6. Batista Realty, LLC. agrees that for a nine month period, following the entry of this agreement, it will not expand Chaps Cafe in any manner. 7. Batista Realty, LLC. agrees that in the event that within a nine month period, following the entry of this agreement, the Washington Park Foundation is able to identify a buyer for Chaps Cafe and the three adjacent lots and a location and a building, which is suitable to Batista Realty LLC., it will apply to the Rhode Island Department of Business Regulation to transfer the licenses and business to the new location. Upon approval of said transfer, Batista Realty, LLC. further agrees to convey to the Washington Park Foundation buyer the existing Chaps Cafe realty, and the 3 adjacent lots for the sum of $100,000 and $130,000, respectively. 2 8. The parties agree that jurisdiction over this consent order and Chaps liquor license will remain exclusively with the R.I. Department of Regulation for a nine month period, following the entry of this order. Subsequent to the signing of the consent order, the Department of Business Regulation moved to suspend, revoke or, in the alternative, deny the transfer of the license, on June 5, 2000. Hearings were reopened to review the impact of two incidents upon Chaps’s liquor license. One incident involved a shooting that had occurred nearby on May 14, 2000. The other incident involved the posting of an advertisement of an illegal drink special.1 The primary issue at the hearing concerned the alleged shooting. Providence Police Officer Gregory Daniels testified that he had responded to a call that there had been a shooting outside Chaps. (Tr. of October 26, 2000 at 16.) When he arrived at the scene, a crowd had gathered around a white car parked about 15 yards from Chaps. (Id. at 6.) Furthermore, he testified that a female was talking to a male inside the vehicle. Id. The male, according to Officer Daniels, appeared to have been shot several times. Id. On closer observation, Officer Daniels noticed that the male had a handgun wrapped in a sock. Id. Officer Daniels recognized the male in the car as Alahandro Brown and determined that the woman speaking to him was his girlfriend. He testified that there had been a fight inside Chaps among some females, and that Alahandro came to help straighten it out. (Id. at 7.) Officer Daniels concluded that he believed the shooting had its origins from events at Chaps. Id. The real estate closing between petitioners occurred on March 31, 2000. On April 1, 2000, DeChristofaro went to Chaps with Batista and gave him the keys and showed him how to operate the equipment. (Tr. of November 3, 2000 at 5.) DeChristofaro took all of his 1 The Hearing Officer found the poster advertising the drink specials to be inconsequential to his analysis because no evidence showed that the poster promoted any illegal activity. (Exh. A/B at 13.) 3 belongings, and the liquor license. (Id. at 11.) At the time of the closing, the liquor license belonged to him. (Id. at 10.) DeChristofaro testified that, subsequent to the closing, he had nothing to do with the operation of Chaps in an official capacity, was not getting paid, and only “stopped by.” (Id. at 7.) Despite Batista’s belief that the consent order gave him the legal authority to operate Chaps, Batista never had such authority because the liquor license was never properly transferred to him. While the consent order details the conditions on which the license transfer was granted, it did not specify the preliminary legal requirements for effectively transferring the liquor license. Batista testified that he believed that the consent order gave him the legal authority to operate Chaps on DeChristofaro’s license. As evidence of his good faith, Batista points out that he hired two detail police officers for two evenings in April. However, DeChristofaro was required to file a 2000 tax return with the Rhode Island Division of Taxation. Id. DeChristofaro’s did not obtain a certificate from the Providence Board of Licenses that his liquor license was in good standing until May 26, 2000. Id. at 6. This certificate of good standing was necessary to effectuate the license transfer and certifies that the license holder has paid all taxes due to the state. G.L. 1956 § 3-7-24. On May 18, 2000, DeChristofaro turned over his liquor license to Richard Aitchison from the Providence Board of Licenses. (Id. at 10.) The Hearing Officer denied the license transfer from DeChristofaro to Batista. The Hearing Officer concluded that if transfer hearings were held at the Providence Board of Licenses, that the City would rely on the evidence of the shooting to reasonably conclude that the license transfer would not be in the best interest of the community. (Exh. A/B at 12.) The Hearing Officer found that the shooting created a safety issue that provided sufficient grounds to 4 deny the license transfer. (Id. at 13.) This appeal followed. At issue before this Court is whether the Hearing Officer abused his discretion in denying the license transfer. Standard of Review The scope of the Superior Court’s review of administrative decisions is confined by G.L. 1956 § 42-35-15(g) which provides: “The court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact. The court may affirm the decision of the agency or remand the case for further proceedings, or it may reverse or modify the decision if the substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: (1) In violation of constitutional or statutory provisions; (2) In excess of the statutory authority of the agency; (3) Made upon unlawful procedure; (4) Affected by other errors or law; (5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or (6) Arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.” In reviewing administrative decisions, the Court will not substitute its judgment for that of the agency in regard to the credibility of witnesses or the weight of evidence concerning questions of fact. Carmody v. Rhode Island Conflict of Interest Com’n, 509 A.2d 453, 458 (R.I. 1986). On review, a Superior Court judge does not weigh the evidence upon which the findings of fact are based but merely reviews the record in order to determine if there is legally competent evidence to support the administrative decision. Bunch v.
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